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Portland approves 10% cap on fees that food delivery apps can charge restaurants

oregonlive.com

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Re: Portland approves 10% cap on fees that food delivery apps can charge restaurants

#321

Post by rootusrootus »

dsr_ wrote: post #294
_sbrk wrote: post #217

Earlier quoted context omitted.

https://www.statista.com/statistics/794278/disabled-populati... Let's take the first-order approximation that 15% of the population is disabled and cannot get their own food. A quick, but by no means, thorough search shows both government and private programs to help these people obtain nutritious food. We could delve into this and go down the rabbit hole of what % of that 15% cannot prepare food or even feed themsel…

There are 330,000,000 people in the USA. 1% of that is 3,300,000 people. Therefore, the Portland-Vancouver MSA (only 2.2 million people) does not exist for any nationwide consideration. Congratulations.

> only 2.2 million people

Nitpick: That was 2010. We're getting closer to 3M now.

Re: Portland approves 10% cap on fees that food delivery apps can charge restaurants

#322

Post by panzagl »

abc-xyz wrote: post #179
chrisseaton wrote: post #94

Earlier quoted context omitted.

> It's falsifying the restaurants prices. It's marking them up... yeah. Is that a problem? Do you realise when you go to a store all the products are 'falsified' by marking them up on top of what the producer sells them to the retailer for?

I’m pretty sure that in most countries, a store can’t just sell another company’s products without entering an agreement with them. This agreement allows the company to set a minimum and maximum price for the product. Imagine you’re selling chocolate that you want people to associate with luxury/wealth. To achieve this you might want to limit resellers to be 5 star hotels and luxury stores rather than the 1 dollar st…

Look up 'grey market'. Lots of companies try to do what you suggest, but in the US there are very few laws that support such a business model.

Re: Portland approves 10% cap on fees that food delivery apps can charge restaurants

#323

Post by saluki »

andrewla wrote: post #282
nathanvanfleet wrote: post #279

Earlier quoted context omitted.

Isn't the 10% cap making the end game of monopoly and higher prices impossible though?

Only if they don't change it in the future in response to "market forces", or if they start charging consumers fees directly or some other workaround and then the city council has to retract this guidance because people are complaining about the higher prices.

The restaurant should get paid regular price for their food and maybe even a little extra to cover boxing it nicely for delivery, keeping it warm. The delivery company should charge the customer the price they need pay to have it delivered to them. I expect the 10% max fee if around the margin the restaurant is making so I'm not sure this fixes anything.

Food delivery is an awesome service but it costs money, consumers should expect to pay a higher right for food and grocery delivery in the long term.

And delivery companies should expect smaller margins for coordinating it.

Re: Portland approves 10% cap on fees that food delivery apps can charge restaurants

#324

Post by mardifoufs »

carlmr wrote: post #277
princevegeta89 wrote: post #232

Earlier quoted context omitted.

It's already 12.5$ with delivery. And even worse, a ton of other fees get added on top of it, making your order total close to 18$. Consumers are already paying enough, so they don't want to pay more. This is the reason why the Apps turn to restaurants instead. Even with that, they aren't still profitable.

Then they should cease being in business.

Couldn't the same argument be made for restaurants? If they can't afford delivery fees, or can't afford to make money without delivery they shouldn't be in business either.

Re: Portland approves 10% cap on fees that food delivery apps can charge restaurants

#325

Post by londons_explore »

bryanlarsen wrote: post #75
londons_explore wrote: post #21

I'd like to see this rule applied only if the delivery provider insists that the menu prices be the same with or without delivery. Personally I think a provider of any 'value add' service being able to dictate the price without their service is insane.

Is this not the case? It looks like it's a cap of 10% on what the app can charge the restaurant. It doesn't say one way or another, but I don't see any restriction on what the app can charge the consumer. The big problem isn't so much the size of these fees, the big problem is that these fees are hidden. Like you, I'd rather see a 0% cap, requiring the app to charge the customer directly.

Some services, like Airbnb for example, specifically say a house owner is not allowed to put a different price on Airbnb Vs some other site. That means the house owner must charge bookings not via Airbnb a higher price than normal to recoup the fees paid on Airbnb bookings.

That should, in my opinion, be outlawed.

Re: Portland approves 10% cap on fees that food delivery apps can charge restaurants

#326

Post by mostlyghostly »

inkaudio wrote: post #99

This is a regulatory response to Silicon Valley’s implementation of predatory pricing. Let me explain: Predatory pricing is defined as “the pricing of goods or services at such a low level that other suppliers cannot compete and are forced to leave the market.” For silicon valley startups like Doordash and Grubhub this is accomplished by acquiring customers at a significant loss in ways that may often seem idiotic. e…

I'm struggling to call this predatory pricing when most of the food delivery app industry is unprofitable.

The correct industry action: push through higher pricing for the end users, share gains with drivers and restaurants to get to a sustainable business model, and accept the resulting decline in unit volume. (which also means fewer drivers will have jobs, so there's a human cost here as well)

It's easy to tell "corporations" to just suck it up, but you're dealing with a pure variable cost business here. If you make it unprofitable to serve a particular geography, they'll just exit the market. That only consolidates future market power in the surviving businesses....

Re: Portland approves 10% cap on fees that food delivery apps can charge restaurants

#327

Post by sidr »

andrewla wrote: post #297
MisterTea wrote: post #143

Earlier quoted context omitted.

> The End game is to be the dominant food ordering platform in any given town where you get to dictate rates like 25%. You fight back by calling your order in and having them deliver it or pick it up yourself. I do this 99%* of the time as I refuse to pay a web server $8+ order+delivery fee for a meal that costs the same. It's absurd to think that people are so lazy that they cant pick up a phone or walk a few blocks…

"You fight back by calling your order in" -- if they are offering free delivery through an app, all you are doing is paying inflated prices to subsidize their delivery customers. If they are not offering you an explicit called-in or picked-up discount, you're not really helping anyone except all those people using the app.

I've noticed more and more restaurants in the Seattle area are listing higher prices for the GrubHubs/UberEats (some have explicitly told me during pickup to just call it in if I want to save some money). The picked up discount already exists within the app. So what you're saying is starting to happen as restaurants wise up.

Re: Portland approves 10% cap on fees that food delivery apps can charge restaurants

#328

Post by _sbrk »

jbay808 wrote: post #298
_sbrk wrote: post #264

Earlier quoted context omitted.

If no-one left the house, there would be no food, water, or electricity. Your argument breaks down at this point. You are, apparently, a reasonably intelligent person capable of highly-structured thoughts. Survival in the world is not guaranteed, and it is your responsibility to work around hardships you encounter. Please refrain from the "victim" word, as this is just the hand of cards you were dealt. We all have a…

(replying here because in your flagged post you asked for lockdown laws that prevent you from going out to buy food) In BC and probably most of Canada, you have to quarantine for 14 days when you enter the country. You are not allowed out farther than your front yard/balcony, and you need to sign a form before you enter claiming that you acknowledge this and have arranged all necessary plans in advance to allow you t…

(Ah, yes, flag when you disagree. How does one challenge a flag?)

There are similar quarantines for individual States in the U.S.A., or at least there were. However, once you've exited the true quarantine period, there are no restrictions on movement.

In _this_ thread, the poster to whom I'm replying asserts that we are under quarantine in Texas, which we are not. Most of the restrictions from the State, counties, and local government apply to businesses, not to individuals. The recent face-covering order is a good one, to prevent coughing, sneezing, or just forceful talking from spreading to someone in front of you. However, we're free to move about as needed, as we should be. Anyone who wants to go 100% isolation, that's fine and I have no qualms. However, I prefer to take a few more calculated risks and live some semblance of my former life before the COVID-19.

Re: Portland approves 10% cap on fees that food delivery apps can charge restaurants

#329

Post by belltaco »

paulgb wrote: post #199
belltaco wrote: post #51

Earlier quoted context omitted.

Add to that drivers complaining that they're getting exploited. But yes, all of those can be true. Paying someone for 30 to 45 minutes of their time is expensive.

> Paying someone for 30 to 45 minutes of their time is expensive. Definitely, but this was also the case before Uber Eats et al.

It's not the same though, because the costs are reduced by two things at places like Pizza joints and Chinese restaurants. First, every trip by a driver would include multiple deliveries, which is very rare with Uber Eats style delivery. Secondly all of the drivers would wait and drive back to a single restaurant, eliminating the time needed for a driver to drive to the restaurant from their spot.

Not to mention that crazy high costs of developing, running and maintaining slick apps that work for all restaurants, restaurant and customer acquisition, and tech support. Those costs have to be made up somehow.

Re: Portland approves 10% cap on fees that food delivery apps can charge restaurants

#330

Post by _sbrk »

dsr_ wrote: post #294
_sbrk wrote: post #217

Earlier quoted context omitted.

https://www.statista.com/statistics/794278/disabled-populati... Let's take the first-order approximation that 15% of the population is disabled and cannot get their own food. A quick, but by no means, thorough search shows both government and private programs to help these people obtain nutritious food. We could delve into this and go down the rabbit hole of what % of that 15% cannot prepare food or even feed themsel…

There are 330,000,000 people in the USA. 1% of that is 3,300,000 people. Therefore, the Portland-Vancouver MSA (only 2.2 million people) does not exist for any nationwide consideration. Congratulations.

I fail to grasp what you are implying. Please explain.
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